Category: Stewardship

ARE YOU MISSING THE POINT OF DONOR LOYALTY?

How do you inspire donor loyalty?

Recently a retailer, that will go unnamed, asked me to participate in an online survey. This retailer is among one of the top brands in the clothing retail space. You would certainly recognize them. I want to use this example to help you inspire donor loyalty within your organization.

I have been purchasing their goods for over 30 years, long before the internet, and have transitioned from being a brick and mortar customer to an online shopper. Admittedly, the latter experience has been encouraged by their relentless email marketing tactics, which have driven me to buy online and avoid the store experience when possible. The regular 20% off coupons that arrive in my inbox continuously mean nothing anymore because I know there will be a much better sale not too far behind.

According to Philanthropy Roundtable, philanthropy is a huge part of what makes America America. They rightly state in a recent post that philanthropy’s importance stretches far beyond economics – case in point – their studies show that each year, seven out of ten Americans donate to at least one charitable cause.

“This is one of the things that I find most interesting about social media – yes, it’s great for entertainment and for engaging people in new, exciting ways, but the true power of the medium is in its connectivity, in its ability to link us together and highlight the commonalities of the human condition.”

Nonprofits are human change agents

“The “non-profit” institution neither supplies goods or services not controls. Its “product” is neither a pair of shoes nor an effective regulation. Its product is a changed human being. The non-profit institutions are human-change agents. Their “product” is a cured patient, a child that learns, a young man or woman grown into a self-respecting adult; a changed human life altogether.”

— Peter Drucker

In 1989, Peter Drucker wrote an article for Harvard Business Review titled “What Business Can Learn from Nonprofits.”

As the story goes, the concept was so counterintuitive that many readers thought the magazine had made a huge typo; surely, it had gotten things backwards. Anyone who was familiar with Drucker, however, knew that he believed in the power of the best nonprofits not only to be effective and highly impactful for the recipients of their services, but also to provide a much-needed sense of fulfillment for their volunteers. “Citizenship in and through the social sector is not a panacea for the ills of … society,” Drucker wrote, but it “restores the civic responsibility that is the mark of community.” Drucker advised the American Red Cross, the Salvation Army, the American Heart Association, the Girl Scouts of America and many others. In 1991, he created the Peter F. Drucker Award for Nonprofit Innovation, which remains among the Drucker Institute’s core programs. READ MORE

For further reading regarding the greatness of Peter Drucker visit HERE

In my opinion, fundraising is more of an art than a science – which means you have to use your heart, intuition and common sense rather than some impersonal, mechanical process.

Nonprofits need to rethink how to measure a charity’s success.

Too many nonprofits, he says, are rewarded for how little they spend — not for what they get done. He questions how to measure a charity’s success. Instead of equating frugality with morality, he asks us to start rewarding charities for their big goals and big accomplishments (even if that comes with big expenses). In this bold talk, he says: Let’s change the way we think about changing the world.

In a recent BBB article it was announced that the BBB’s Wise Giving Alliance, which is the Better Business Bureau’s charity watchdog arm, will begin a new initiative to verify the truthfulness of charitable appeals.

The article quotes H. Art Taylor the President & CEO of the BBB Wise Giving Alliance – Taylor says: “We are concerned about the extent to which charities are not providing sufficient oversight over paid fundraising firms, these firms sometimes employ more aggressive and potentially misleading tactics to increase donor response”.

The success of any robust and successful fundraising process centers on four basic steps. They hold true for all levels and types of fundraising, but they are particularly essential for any successful capital campaign or major gift program.

Fundraising is more of an art than a science.

Which means you have to use your intuition and common sense rather than some impersonal or overly mechanical system. It’s important that the process is genuine, sincere and donor-focused. It must, above all things, focus on the person — who they are and what they are interested in — long before the financial aspects of the process come into play.

The simple fact is that most people tend to support winners. Organizations that handle the funds they receive in the most effective, honest, and efficient way seem to perform better then those that don’t. You can’t overlook this fact.

Now that’s a million dollar question that we would all like the answer for wouldn’t we? The problem is this question is as elusive and subjective as asking a Wall Street professional when will we “hit the bottom”.

We are all confronted with two seemingly opposing forces with our fundraising efforts. Building a relationship with our donor should always be front and center for us. We know that without a compelling relationship with our supporter no relationship can continue over the long-term — it will simply die out because there is no inspiring reason for it to continue.